1 2025:CGHC:22341 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WP227 No. 485 of 2014 1 – Smt.Bai W/o Harish Chandra Sahu Aged About 40 Years R/o Vilalge Khadgawan Tahsil Manendragarh Distt. Koriya C.G. , Chhattisgarh 2 - Smt. Dilbas Bai W/o Ramjanak Sahu Aged About 63 Years R/o Vilalge Khadgawan Tahsil Manendragarh Distt. Koriya C.G. , District : Koriya (Baikunthpur), Chhattisgarh 3 - Smt. Karma Vati Bai W/o Sudama Prasad Sahu Aged About 45 Years R/o Vilalge Khadgawan Tahsil Manendragarh Distt. Koriya C.G. , District : Koriya (Baikunthpur), Chhattisgarh 4 - (Died), Ramjanki Sahu Through Lrs. As Per Hon'ble Court Order Dated 26-09-2022, 4.1 - A. Ishwar Dayal Sahu S/o Ramjanak Sahu Aged About 42 Years R/o Village Post Khadgawa Mcb (Manendragarh, Chirmiri, Bhatapara) District - Korea, Chhattisgarh 4.2 - B. Baby Sahu W/o Bans Kumar Sahu Aged About 37 Years R/o Village Koriya P/o - Bachara Pordi District Koriya Chhattisgarh ... Petitioner(s) versus 1 - Ratan Singh, S/o Late Rekha Singh Aged About 50 Years R/o Vilalge Khadgawan Tahsil Manendragarh Distt. Koriya C.G. , Chhattisgarh 2 - Birendra Singh S/o Shri Bhupdev Singh Aged About 45 Years R/o Vilalge Khadgawan Tahsil Manendragarh Distt. Koriya C.G. , District : Koriya (Baikunthpur), Chhattisgarh 3 - Ishwar Prasad S/oshri Bhupdev Singh Aged About 40 Years R/o Vilalge Khadgawan Tahsil Manendragarh Distt. Koriya C.G. , District : Koriya (Baikunthpur), Chhattisgarh 4 - The State Of Chhattisgarh Through The Collector Koriya, Distt. Koriya C.G, District : Koriya (Baikunthpur), Chhattisgarh 5 - Commissioner, Sarguja Division Ambikapur Distt. Surguja C.G. , -2- District : Surguja (Ambikapur), Chhattisgarh 6 - The Additional Collector And Nodal Officer, Manendragarh, Distt. Koriya C.G. , District : Koriya (Baikunthpur), Chhattisgarh 7 - The Sub Divisional Officer Revenue Khadgawan, Chirmiri Distt. Koriya C.G. , District : Koriya (Baikunthpur), Chhattisgarh ---- Respondents For Petitioners : Dr. N.K. Shukla, Senior Advocate with Ms. Priya Mishra, Mr. Nitikesh Gupta and Mr. Dinesh Bole, Advocates For Respondents No.1 to 3 : Mr. B.P. Sharma, Advocate with Mr. Sanjay Pathak Mr. Pushp Gupta and Mr. Vaibhav Tiwari, Advocate For State/respondents : Mr. Shubham Bajpai, Panel Lawyer No.4 to 7 Date of Hearing : 28.03.2025 Date of Judgment : 27.05.2025 Hon'ble Shri Justice Rakesh Mohan Pandey CAV JUDGMENT 1) The petitioners have challenged the order passed by the Commissioner, Surguja Division, Ambikapur, in Revenue Revision Case No.87/A-23/2010-11 dated 16.06.2014 by filing the instant petition. 2) The facts of the present case are as under:- (i) The subject matter of this petition is the lands bearing Survey Nos. 495, 529, 542, 544, 545 & 493 admeasuring 7.86 hectares situated at Village Khadgawan, Tehsil Manendragarh, District Koriya (C.G.) which were the ancestral property of respondents No.1 to 3. Respondents No.1 to 3 belong to the ‘Gond’ community which is a notified scheduled tribe. (ii) The excise contract for the shop ‘Village-Pusala” situated at Tehsil- Baiknthpur, District Surguja was awarded to one Shri K.K. Agrawal on 19.01.1968. 3 (iii) An agreement was entered into between Shri K.K. Agrawal and the State on the same date. (iv) Late Rekha Singh was stated to have signed the agreement as a surety. The said contract was transferred in the name of the father of the late Rekha Singh on 22.02.1968. (v) It appears that neither late Rekha Singh nor her father could pay the premium of excise shop to the Government, therefore, the above-stated survey numbers were attached by the Additional Tahsildar (Excise) and an auction notice for the recovery of dues was issued. (vi) In the auction, one Smt. Joginder Kaur purchased the subject property, a sale deed was executed by the Additional Tahsildar (Excise) in her favour and the transaction was confirmed by the Collector Surguja. (vii) Pursuant to the confirmation of the sale, a registered sale deed was executed on 31.05.1973. The name of Smt. Joginder Kaur was entered into the revenue records. (viii) An application for reversion of the land was moved by late Rekha Singh before the Sub-Divisional Officer (Revenue) and a case was registered as Revenue Case No.132/A-23/1981-82. (ix) The authority issued a notice to Smt. Joginder Singh. The Sub- Divisional Officer (Revenue) concluded that the subject property was sold to Smt. Joginder Kaur through a public auction for recovery of Government dues, therefore, the provisions of Section 170-B of the Chhattisgarh Land Revenue Code, 1959 (for short ‘the Code of 1959’) would not attract and the application was rejected vide order dated 31.08.1982. -4- (x) Petitioners No.1 to 4 purchased the subject property through four different sale deeds dated 10.10.1995 from Smt. Joginder Kaur. (xi) After the death of Rekha Singh, her legal representatives moved another application under Section 170-B of the Code of 1959 for the reversion of land and a case was registered as Revenue Case No.44/B-23/2002-03. (xii) The Sub-Divisional Officer (Revenue) vide order dated 23.08.2004 rejected the application on the ground that earlier an application was dismissed on merits, therefore, the subsequent application is not maintainable. (xiii) Respondents No.1 to 3 preferred an appeal before the Additional Collector, Manendragarh, District Koriya against the order dated 23.08.2004. The Additional Collector, Manendragarh affirmed the findings recorded by the Sub-Divisional Officer (Revenue) vide order dated 17.08.2007. It was also held that the State is entitled to recover revenue dues by the sale of agricultural land belonging to the aboriginal tribe. (xiv) Respondents No.1 to 3 preferred a revision before the Commissioner, Surguja Division, Ambikapur. The Revisional Authority set aside the auction sale and issued a direction for the reversion of land to the members of the aboriginal tribe vide order dated 16.06.2014. (xv) The petitioners have challenged the said order by filing this petition. 3) Dr. Shukla, learned Senior Advocate appearing for the petitioners would argue that the petitioners after a due inquiry and verifying the revenue record purchased the subject property through a registered sale deed 5 after payment of consideration. He would contend that part of the subject property has been assigned to the son of Smt. Joginder Kaur namely Gurmet Singh. It is also stated that petitioners No.1 to 3 namely, Smt. Bai, Smt. Dilbas Bai and Smt. Karmavati purchased part of the subject land through registered sale deeds dated 10.10.1995. Learned Senior Advocate would further argue that Section 2(u) of the Code of 1959 defines “Revenue Officer”. He would further contend that the State Government by a notification has conferred powers on the Tahsildar (Excise) to discharge the functions of a Revenue Officer. He would also contend that the District Excise Officer has been conferred with the powers of the Additional Tahsildar. Dr. Shukla would further submit that Section 146 of the Code of 1959 deals with the notice of demand whereas Section 147 of the Code of 1959 deals with the process for recovery of arrears. He would also submit that arrears of land revenue payable to the Government or Gram Sabha may be recovered by the Tahsildar by any one or more of the following processes i.e. by attachment and sale of movable property; by attachment and sale of the holding on which arrears is due and where such holding consists of more than one survey number or plot number, by sale of one or more of such survey numbers or plot numbers as may be considered necessary to recover the arrears; and by attachment and sale of any other immovable property belonging to the defaulter. He would also contend that Section 155 of the Code of 1959 deals with money recoverable as arrears of land revenue. He would refer to Section 156 of the Code of 1959 and submit that every person who may have become a surety under any of the provisions of this Code or under any other enactment or any grant, lease or contract whereunder -6- the sum secured is recoverable from the principal as arrears of land revenue shall on failure to pay the amount or any portion thereof which he may have become liable to pay under the terms of his security bond, he liable to be proceeded against under the provisions of this Code in the same manner as for an arrear of land revenue. Dr. Shukla, learned Senior Counsel would further state that initially, an application under Section 170-B of the Code of 1959 was moved by the late Rekha Singh herself and it was rejected by the Sub-Divisional Officer (Revenue) vide order dated 31.08.1982. He would also state that after the death of Rekha Singh, her legal representatives moved another application under the same provisions of law but the same was also dismissed vide order dated 23.08.2004. He would also contend that a civil suit was filed by respondents No. 1 to 3 claiming therein the right over the property, which was dismissed and a regular civil appeal was also dismissed. He would also contend that the property of the late Rekha Singh was put for auction as arrears of excise and provisions of Section 170-B of the Code of 1959 would not attract at all. He would refer to Section 2(8) of the Chhattisgarh Excise Act to buttress his submissions He would also refer to Section 64 of the Chhattisgarh Excise Act which deals with the recovery of Government dues. He would further refer to Sections 147 & 155 of the Code of 1959. 4) It is submitted by the learned Senior Advocate that the subject land was sold in public auction by the District Excise Officer Surguja (Additional Tehsildar Excise) for recovery of excise dues against late Rekha Singh as she could not make payment of dues for the liquor shop Pusla for the year 1968-69. He would contend that the auction-sale was conducted on 15.03.1963 and it was confirmed by the District Collector 7 and subsequently, a sale certificate was issued on 31.05.1973. He would further submit that the State Government has conferred the power of Additional Tehsildar to the District Excise Officer according to the provisions of Section 19(2) of the Code of 1959 and a notification was issued in this regard on 04.07.1968. Dr. Shukla would further contend that Section 64 of the Excise Act deals with the recovery of Government dues. He would also submit that according to this Section, all dues payable to the Government on account of any contract relating to the excise revenue may be recovered from the person primarily liable to pay the same or from his surety by distress and sale of his movable property or for the recovery of land revenue. He would state that the first application moved by late Rekha Singh under Section 170-B of the Code of 1959 was dismissed by the Sub-Divisional Officer vide order dated 31.08.1982 and therefore, the subsequent application moved by her legal representatives was not maintainable at all and it was hit by the principle of res judicata. He would further state that the Commissioner (Division) Surguja committed an error of law in holding that fraud was played with members of the aboriginal tribe. He would also contend that Section 165(C) of the Code of 1959 deals with the voluntary transfer of land and it does not prohibit the auction sale of Bhumiswami land if the excise revenue is due under Section 64 of the Madhya Pradesh Excise Act, 1915. In support of his contentions, he placed reliance on the judgment passed by the High Court of Madhya Pradesh in the matter of Ram Ratan Gupta vs The State Of Madhya Pradesh And Ors., AIR 1974 MP 101, Bajrang Prasad Vs. State of Madhya Pradesh and others, AIR 1973 MP 95, Manoharlal Awal Vs. State of Madhya Pradesh and others, AIR 1978 MP 152 and -8- Dhirendra Nath Sharma, Vs. State of Madhya Pradesh and another, 1985(30) MPLJ 786. 5) On the other hand, Mr. Sharma, the learned counsel appearing for respondents No.1 to 3 would oppose the submissions made by Dr. Shukla. He would argue that an application under Section 170-B of the Code of 1959 was moved by respondents No.1 to 3 for reversion of land before the Sub-Divisional Officer, Chirmiri, wherein, it was stated that they had never taken a loan from any bank or institution and neither signed any document as a guarantor. The Sub-Divisional Officer (Revenue) dismissed the application. It is contended that the appeal was also dismissed by the Collector. He would further contend that a revision was preferred before the Court of the Commissioner, Surguja Division and findings recorded by the Sub-Divisional Officer were set aside. It was held that (I) the late Rekha Singh was not an excise contractor, (ii) no contract was executed between the late Rekha Singh and the excise department; (iii) the late Rekha Singh was only the power of attorney holder of K.K. Agrawal, (iv) guarantor of late K.K. Agrawal was one Devnarayan Singh, a resident of Village Khadgawan. It was further held that the transaction was fraudulent therefore, provisions of Section 170-B of the Code of 1959 would attract. Mr. Sharma would also submit that prior to the auction, no demand notice of auction was given to the father of respondents No.1 to 3 and the entire proceedings were concluded in a clandestine manner. He would further contend that fraud was played with the members of the aboriginal tribe and the same is evident from a perusal of records of bids Annexure R/2, which would show that the amount of bid was doubled by Mr. K.K. Agrawal to the tune of Rs.16,000/- to secure the 9 bid. He would also contend that the license was transferred by Mr. K.K. Agrawal to the tune of Rs.16,000/- in favor of the father of Late Rekha Singh. He would also contend that the original records of Revenue Case No.112/A-96/69-70 regarding public auction were not deposited with the Record Keeper. He would state that according to clause 3 of the Agreement, the Excise department ought to have taken action against Mr. K.K. Agrawal. He would further submit that earlier, the first application moved under Section 170-B of the Code of 1959 was rejected on technical grounds and the subsequent application was maintainable. He would further argue that fraud was played with late Rekha Singh and her father and therefore, the principle of res-judicata would not apply. In support of his contentions, he placed reliance on the judgments passed by the Hon’ble Supreme Court in the matter of S.P. Chengalvaraya Naidu(dead) by Lrs. Vs. Jagannath (Dead) by Lrs. And others, 1994(1) SCC 1, Meghmala and others V. G. Narasimha Reddy and others, 2010(8) SCC 383, Krishna Hare Gaur V. Vinod Kumar Tyagi and others, 2015 (11) SCC 355 and the order passed by the Coordinate Bench of this Court in the matters of Joseph (dead) Through Lrs. Vs. Dhaneshwar Sao (dead) through Lrs., 2018 CG 938, Usha Mirani and Anr. Vs. State of Chhattisgarh, Writ Appeal No.421/2010 and Son Singh and others Vs. Bholanath Joshi(dead) through Lrs., Writ Appeal No.136/2024. 6) Mr. Bajpayee, learned Panel Lawyer appearing for the State would support the order passed by the Commissioner. 7) Heard learned counsel appearing for the parties and perused the documents placed on the record. -10- 8) Respondents No.1 to 3 have filed a copy of the agreement entered into between the State of Madhya Pradesh through Collector Surguja and Kailash Kumar Agrawal dated 18.01.1968. Vide agreement dated 18.01.1968, Mr. Kailash Kumar Agrawal was granted a license to sell liquor at liquor shop in Pusla, District Surguja. A list of bids would show that Mr. K.K. Agrawal quoted a bid of Rs.16,000/- and it was accepted. This document was signed by the late Rekha Singh, the power of attorney holder as a surety. According to Form G-1, the register of shops put to auction, the Shop situated at Pusla was allotted to Mr. K.K. Agrawal on 19.01.1968 for the sale of country spirit liquor. The name of the surety was Devnarayan Singh, S/o Rajeshwari Pratap Singh, Village Khadgawan, Tehsil Manendragarh. It is also mentioned in the document that the liquor shop was transferred in the name of Rekha Singh on 22.02.1968 and later on, it was transferred in the name of someone else on 01.08.1968. 9) Respondents No.1 to 3 have placed on record a certificate issued by the Record Keeper, Collectorate Koriya to the effect that the original record of Revenue Case No.112/A-96/69-70 Village Khadgawan is not available in the record room. 10) An application under Section 170-B and Section 165 of the Madhya Pradesh Land Revenue Code was moved by Rekha Singh wherein it was specifically stated that K.K. Agrawal by playing fraud obtained his signature as a surety and deliberately failed to pay installments/premium and on account of this reason, her land was put for auction. It is also stated that no action was taken against the liquor contractor namely, K.K. Agrawal and the guarantor. 11 11) A complaint was made by the petitioners before the Collector and a letter was sent by the Deputy Collector Koriya to the District Excise Officer whereby certain information was sought. The District Excise Officer vide letter dated 30.08.2002 informed the Collector Koriya that the contract was awarded to Shri K.K. Agrawal and sureties were Devnarayan Singh and Rekha Singh (Power of Attorney). The license was transferred in favour of the father of the complainant on 22.02.1968 but the record is not available. It is also stated that no document is available with the department to establish that any bond was executed between the State and the father of late Rekha Singh. 12) Annexure R/8 is the inquiry conducted by the Excise department wherein it was found that (i) license was not transferred in the name of the father of Rekha Singh; (ii) according to the original agreement, the sureties were Devnarayan Singh and Rekha Singh; (iii) on 22.02.1968, the license was transferred in favour of Rekha Singh; (iv) the letter of consent of the father of Rekha Singh prior to the transfer of the agreement is not available with the department; (v) the transfer of the agreement was not approved by the District Collector; (vi) the names of sureties are not clear after the transfer of the agreement; (vii) thus, the transfer of the agreement was found doubtful. It was also observed that being a case of fraud, the proceeding under Section 170-B of the Madhya Pradesh Land Revenue Code is tenable. 13) Respondents No.1 to 3 after the rejection of their application under Section 170-B of the Code of 1959 preferred an appeal before the District Collector and it was dismissed. Thereafter, the petitioners preferred a revision before the Commissioner. The Commissioner -12- examined the matter and held that fraud had been played with the members of the aboriginal tribe and they were not evicted in due course of the law. It is also observed that for recovery of excise dues, proceedings were not conducted in accordance with the law and thus, all transactions were declared null and void and an order was passed for reversion of land. 14) It is not in dispute that according to the provisions of Section 19(2) of the Madhya Pradesh Land Revenue Code, the Tehsildars have been conferred with the powers of the District Excise Officers vide notification dated 4th of July, 1968. 15) According to the provisions of Section 64 of the Excise Act, the Government dues may be recovered from sureties or persons primarily liable on account of any contract relating to the excise revenue as land revenue. 16) Section 64 of the Excise Act is reproduced herein below:- “64.Recovery of Government dues (1) The following moneys,namely,- (a) all excise-revenue, (b) any loss that may accrue when, in consequence of default, a grant has been taken under management by the Collector, or has been resold by him, and (c) notwithstanding anything contained in Section 74 of the Contract Act, 1872 (No. 9 of 1872) all amounts due to the Government by any person on account of any contract relating to the Excise revenue in accordance with any provision of this Act or rules. made thereunder, and all amount to be paid on breach of conditions of a bond or instrument by which a person binds himself to perform any duty or act or undertakes that he and his servants and agents will abstain from any act, may be recovered from the person primarily liable to pay the same, or from his surety (if any), by distress and sale of his movable property, or by any other process for the recovery of land revenue due from land-holders or from farmers of 13 land or their sureties. (2) When a grant has been taken under management by the Collector, or has been re-sold by him, the Collector may recover, in any manner authorized by sub-section (1), any money due to the defaulter by any lessee or assignee.” 17) Sections 147 & 155 of the Code of 1959 are also reproduced herein below:- “147. Process for recovery of arrear.- An arrear of land revenue payable to Government or Gram Sabha may be recovered by a Tahsildar by any one or more of the following processes :- (a)by attachment and sale of movable property; (b)by attachment and sale of the holding on which arrear is due and where such holding consist of more than one survey number or plot number by sale of one or more of such survey numbers, or plot numbers as may be considered necessary to recover the arrears :Provided that no holding shall be sold for the recovery of any dues of a co-operative society without first exhausting the procedure prescribed in Section 154-A. (bb)by attachment of holding on which arrear is due and letting the same under Section 154-A; (bbb)by attachment of any other holding belonging to the defaulter which is used for the purposes of agriculture and letting the same under Section 154-A (c)by attachment and sale of any other immovable property belonging to the defaulter : Provided that the process specified in clauses (a) and (c) shall not permit the attachment and sale of the following, namely : (i) the necessary wearing apparel, cooking vessels, beds and bedding of the defaulter, his wife and children, and such personal ornaments, as, in accordance with the religious usage, cannot be parted with by any woman; (ii) tools of artisans and, if the defaulter is an agriculturist, his implements of husbandry, except an implement driven by mechanical power and such cattle and seed as may, in the opinion of the Tahsildar, be necessary to enable him to earn his livelihood as such;(iii) articles set aside exclusively for the use of religious endowments; (iv) house and other buildings (with the materials and the sites thereof and the land immediately appurtenant thereto and necessary for the enjoyment) belonging to an agriculturist and occupied by him : Provided further that the process specified in clause -14- (b) shall not permit attachment and sale of holding where the defaulter holds,- (i) six hectares or less than six hectares of land in the Scheduled Area; or (ii) four hectares or less than four hectares of land in other areas. Explanation-For the purpose of this proviso, "Scheduled Area" means any area declared to be Scheduled Area within the State of Chhattisgarh under paragraph 6 of the Fifth Schedule to the Constitution of India.” 155. Moneys recoverable as an arrear of land revenue- The following moneys may be recovered, as far as may be, under the provisions of this Chapter in the same manner as an arrear of land revenue : (a) except such charges as are included in the land revenue under sub-section (2) of Section 58, all rents, royalties, water rates, cesses, fees, charges, premia, penalties, fines and cost payable or leviable under this Code or any other enactment for the time being in force; (b) all moneys falling due to the State Government under any grant, lease or contract which provides that they shall be recoverable in the same manner as an arrear of land revenue; (bb) all moneys guaranteed by the State Government to the extent of amount guaranteed under a contract of guarantee which provides that they shall be recoverable in the same manner as an arrear of land revenue; (c) all sums declared by this Code, or any other enactment for the time being in force to be recoverable in the same manner as an arrear of land revenue; and (d) any sum ordered by a liquidator appointed under any law relating to Co-operative Societies in force for the time being in any region of the State to be recovered as a contribution to the assets of a society or as the cost of liquidation : Provided that no action shall be taken on application for recovery of a sum specified in clause (d), unless such application is accompanied by a certificate signed by the Registrar appointed under such law that the sum should be recovered as an arrear of land revenue; (e) all moneys becoming payable to the Chhattisgarh State Agro Industries Development Corporation Limited- (i)on account of penalty, cost of agricultural implements or other materials sold by the Corporation 15 to agriculturists for the purpose of agriculture or improvement of land or otherwise, under any agreement of sale of such implements or materials by the said Corporation; (ii) in repayment of any loan advanced by the said Corporation or of any amount due to the said Corporation under any lease, contract, or agreement with or any other dealing of the said Corporation : Provided that no action shall be taken on application for recovery of a sum specified in this clause, unless such application is accompanied by a certificate signed by the Managing Director of the said Corporation that the sum should be recovered as an arrear of land revenue; (f) all moneys becoming payable to the Chhattisgarh Laghu Udyog Nigam Limited and the Chhattisgarh Audyogik Vikas Nigam Limited- (i) on account of service charge, penalty, interest, cost of machinery or other materials sold by the said Nigams to entrepreneurs for the purpose of establishing, expanding or running an industry or for any other purpose ancillary to an industry under any agreement of sale on hire purchase or otherwise of such machinery or materials by the said Nigams; (ii) on account of rent or cost of building hired out or sold, as the case may be, by the said Nigams under any lease, contract or agreement; (iii) in repayment of any loan advanced by the said Nigams, or of any amount due to the said Nigams under any lease, contract or agreement with or any other dealing of the said Nigams : Provided that no action shall be taken on application for recovery of a sum specified in this clause unless such application is accompanied by a certificate signed by the Managing Director of the said Nigam that the said sum should be recovered as an arrear of land revenue; (g)all moneys becoming payable to the Chhattisgarh Lift Irrigation Corporation Limited on account of (i)construction charges of the tube-wells; (ii)water rates for the water supplied for the purpose of irrigation from any Lift Irrigation Schemes; (iii)any sum due to the said Corporation under any lease, agreement or contract executed with the said Corporation : Provided that no action shall be taken on application for recovery of a sum specified in this clause unless such application is accompanied by a certificate signed by the Managing Director of the said corporation that the said sum should be recovered as an arrear of land revenue.” 18) A conjoint reading of Section 64 of the Excise Act and Sections 147 -16- & 155 of the Code of 1959 would make it clear that the recovery of government revenue is permissible as excise revenue and it can be recovered as money recoverable as arrears of land revenue. It includes unsatisfied dues of the State Government under any grant or lease or contract, which provides that it shall be recoverable as land revenue. 19) In the present case, auction proceedings were initiated against late Rekha Singh as she failed to make payment of excise dues and the contract was transferred in her favor on 22.02.1968. It is an undisputed fact that the record of the bid is not available with the department. Therefore, it cannot be ascertained that the agreement was duly transferred in accordance with the provisions of the Excise Act in favour of the father of Rekha Singh or Late Rekha Singh. The list of bids filed by respondents No.1 to 3 would show that Rekha Singh signed that document as a surety and power of attorney holder. Meaning thereby, she was a power of attorney holder of someone else. As a copy of the power of attorney is not available, it cannot be inferred that she was the power of attorney holder of her father or K.K.Agrawal. 20) After the transfer of the agreement in favour of the father of Rekha Singh, the department failed to appoint sureties and if Mr. K.K. Agrawal failed to make payment of excise dues, immovable property belonging to Rekha Singh could have not been put for auction. The documents would further show that there was one more surety namely, Devnarayan Singh and no action was taken against him even though no action was taken against K.K. Agrawal. 17 21) In the matter of Ram Ratan Gupta (supra), the Court has held as under:- “………….the final bids of the petitioner in both the cases regarding Bhang and Bhanahota were accepted by the Collector and the petitioner also signed the bid lists, which were counter-signed by the District Excise Officer. As such, the petitioner's liability arose when his bid was accepted. On a reference to the conditions of auction as contained in Annexure R/4, it is pertinent to note that an excise contractor is required to deposit 1/6th of the amount upon his bid being accepted as deposit which would be liable to be forfeited, Thus, the deposit is not a condition precedent, but is a condition which follows the acceptance of the bid. As such, the coming into existence of a contract by virtue of the statutory provision is not dependent on a deposit of the 1/6th amount as a condition precedent and as such the case of State of Madhya Pradesh v. Firm Gobardhan Dass Kailash Nath (supra) relating to a forest contract would be distinguishable. In forest contracts also initial deposit of 25% of the auction bid is required to be made. But the contract comes into existence not merely by acceptance of the bid, but by execution of a formal deed of contract as required by Article 299(1) of the Constitution of India. Therefore, we are unable to hold that the said condition of deposit is an ingredient part of a contractor's liability coming into existence. The liability arises upon the contractor's bid being accepted by the authority empowered in that behalf. It appears that the petitioner after signing the bid lists never cared to appear thereafter and avoided to discharge his responsibilities arising out of the auction sale. Thus, the excise authorities had full justification for re-auctioning the licence and they had legal authority to recover the amount of loss from the petitioner. 22) In the present case, neither Late Rekha Singh nor her father participated in the bid; their bid was never accepted; the bid was never counter signed by the Collector or Excise Officer and documents in this regard are not available with the department, therefore, the facts of the cited case are distinguishable from the facts of the present case. -18- 23) In the matter of Bajrang Prasad (supra), the Court has held as under:- “Thus, it is quite clear that the amount paid by the petitioner for obtaining the privilege of selling liquor at a particular shop is the lease amount which the petitioner had agreed to pay for obtaining that privilege. It is not merely a fee for obtaining the licence under Section 28 of the Excise Act. 24) The petitioners failed to produce any document to establish that any excise license was issued in favor of Late Rekha Singh or her father and there was any agreement to make payment of the lease amount. Thus the cited case doesn't help the petitioners. 25) In the matter of Manoharlal Awal (supra), the Court has held as under:- “3. The recovery proceedings are in respect of royalty on limestone. It is common ground that the proceedings have been taken under Chapter XI of the M. P. Land Revenue Code, inasmuch as by virtue of Section 155 of the Code moneys are recoverable in the same manner as an arrear of land revenue. That section enacts that moneys may be recovered, as far as may be, under the provisions of that Chapter in the same manner as an arrear of land revenue. Now. Section 150 runs thus :-- "150. Payment under protest and suit for recovery.---(1) If proceedings are taken under this Chapter against any person for the recovery of an arrear of land revenue, he may, at any time before the property is knocked down at a sale, pay the amount claimed and may, at the same time, deliver a protest signed by himself or by his authorised agent to the Revenue Officer taking such proceedings, and thereupon they shall be stayed. (2) Any person complying with the provisions of Sub-section (1) may, notwithstanding anything contained in Section 145, apply to the Sub- Divisional Officer that nothing was due or that the amount due was less than the amount for the recovery of which proceedings were taken and the Sub-Divisional Officer shall decide the objection so raised. (3) No appeal shall lie against the order of the Sub- 19 Divisional Officer passed under Sub-section (2) but the person concerned may institute a civil suit for the recovery of the sum or Dart thereof paid under protest. 16. Section 150 of the M. P. Land Revenue Code, applies to recovery of "an arrear of land revenue" but not to proceedings for the recovery of any sum of money which is "recoverable as an arrear of land revenue" within the meaning of Section 155 of that Code. (2) In a proceeding for the recovery of an "arrear of land revenue", the person proceeded against has an alternative remedy by applying to the Sub- Divisional Officer for the determination of the objection that no amount was due or that the amount due was less than the amount claimed in the proceeding, and that decision is subject to a civil suit. The suit contemplated in Sub-section (3) of Section 150 is an alternative remedy within the meaning of Article 226(3) of the Constitution and Section 58 (2) of the Constitution (42nd Amendment) Act, 1976. (3) In a proceeding for the recovery of a sum of money "recoverable as an arrear of land revenue", the provisions of Section 150 of the Land Revenue Code are inapplicable. Neither the proceeding under Sub-section (2), nor a civil suit under Sub-section (3) is available to a defaulter. Thus, in such a case, a civil suit contemplated under Section 150 (3) of the Code is not an alternative remedy. (4) The question whether in a case for the recovery of a sum of money "recoverable as an arrear of land revenue" a civil suit under the general law will be an alternative remedy within the meaning of Article 226(3) of the Constitution, or Section 58 (2) of the" Constitution (42nd Amendment) Act. 1976, is not before us. We, therefore, do not express any opinion on that question." 26) The provisions of Section 64 of the Excise Act and Sections 147 & 155 of the Land Revenue Code make it clear that excise arrears can be recovered as land revenue. The judgments cited by the learned Senior Advocate in this regard strengthen his submissions. But prior to initiating recovery proceedings of excise arrears, the Department was required to prove the existence of any agreement between the Excise Department and Late Rekha Singh or her -20- father. Late Rekha Singh was shown as a surety in the list of Bids only and with regard to the transfer of the agreement or license there is no document. 27) In the matter of Dhirendra Nath Sharma (supra), in relevant para 17 it was observed thus:- “17………………...These provisions are enacted only to declare invalid those transactions which were-invalid from the outset and had not conveyed any title to the non-tribal transferee. It is now well settled that there is nothing like nullity in the absolute sense and even a nullity continues to operate unless so declared by a proper forum in a proper proceeding (see Wade on Administrative Law, Fourth Edition, at p. 300). The impugned provisions, therefore, enabled declaration as nullity of transactions which were nullity from inception being unconscionable transactions between unequals in which the consent of the tribal transferor was not a free consent and the contract resulting in the transfer was void on account of absence of the essentials to make a valid contract. The arguments based on the repealed Article 19(1) (f) and Article 31 and the existing Article 300A of the Constitution have therefore, no foundation and do not require any further consideration.” 28) With regard to res judicata, in the matter of Meghmala (supra), the Hon’ble Supreme Court has held that the fraud avoids all judicial acts ecclesiastical or temporal. It is also held that no judgment of a Court, no order of a Minister can be allowed to stand if it has been obtained by fraud. It is further held that statutory bars like doctrine of res judicata and statutory remedy are not attracted when advantage has been gained by playing fraud. Relevant paras 32 to 36 are reproduced herein below:- “32. The ratio laid down by this Court in various cases is that dishonesty should not be permitted to bear the fruit and benefit to the persons who played fraud or made misrepresentation and in such circumstances 21 the Court should not perpetuate the fraud. (See District Collector & Chairman, Vizianagaram Social Welfare Residential School Society, Vizianagaram & Anr. Vs. M. Tripura Sundari Devi (1990) 3 SCC 655; Union of India & Ors. Vs. M. Bhaskaran (1995) Suppl. 4 SCC 100; Vice Chairman, Kendriya Vidyalaya Sangathan & Anr. Vs. Girdharilal Yadav (2004) 6 SCC 325; State of Maharashtra v. Ravi Prakash Babulalsing Parmar (2007) 1 SCC 80; Himadri Chemicals Industries Ltd. Vs. Coal Tar Refining Company AIR 2007 SC 2798; and Mohammed Ibrahim & Ors. Vs. State of Bihar & Anr. (2009) 8 SCC 751). 33. Fraud is an intrinsic, collateral act, and fraud of an egregious nature would vitiate the most solemn proceedings of courts of justice. Fraud is an act of deliberate deception with a design to secure something, which is otherwise not due. The expression "fraud" involves two elements, deceit and injury to the person deceived. It is a cheating intended to get an advantage. (Vide Dr. Vimla Vs. Delhi Administration AIR 1963 SC 1572; Indian Bank Vs. Satyam Fibres (India) Pvt. Ltd. (1996) 5 SCC 550; State of Andhra Pradesh Vs. T. Suryachandra Rao AIR 2005 SC 3110; K.D. Sharma Vs. Steel Authority of India Ltd. & Ors. (2008) 12 SCC 481; and Regional Manager, Central Bank of India Vs. Madhulika Guruprasad Dahir & Ors. (2008) 13 SCC 170). 34. An act of fraud on court is always viewed seriously. A collusion or conspiracy with a view to deprive the rights of the others in relation to a property would render the transaction void ab initio. Fraud and deception are synonymous. Although in a given case a deception may not amount to fraud, fraud is anathema to all equitable principles and any affair tainted with fraud cannot be perpetuated or saved by the application of any equitable doctrine including res judicata. Fraud is proved when it is shown that a false representation has been made (i) knowingly, or (ii) without belief in its truth, or (iii) recklessly, careless whether it be true or false. Suppression of a material document would also amount to a fraud on the court. (Vide S.P. Changalvaraya Naidu (supra); -22- Gowrishankar & Anr. Vs. Joshi Amba Shankar Family Trust & Ors. AIR 1996 SC 2202; Ram Chandra Singh Vs. Savitri Devi & Ors. (2003) 8 SCC 319; Roshan Deen Vs. Preeti Lal AIR 2002 SC 33; Ram Preeti Yadav Vs. U.P. Board of High School & Intermediate Education AIR 2003 SC 4628; and Ashok Leyland Ltd. Vs. State of Tamil Nadu & Anr. AIR 2004 SC 2836). 35. In kinch Vs. Walcott (1929) AC 482, it has been held that : "....mere constructive fraud is not, at all events after long delay, sufficient but such a judgment will not be set aside upon mere proof that the judgment was obtained y perjury." Thus, detection/discovery of constructive fraud at a much belated stage may not be sufficient to set aside the judgment procured by perjury. 36. From the above, it is evident that even in judicial proceedings, once a fraud is proved, all advantages gained by playing fraud can be taken away. In such an eventuality the questions of non-executing of the statutory remedies or statutory bars like doctrine of res judicata are not attracted. Suppression of any material fact/document amounts to a fraud on the court. Every court has an inherent power to recall its own order obtained by fraud as the order so obtained is non est.” 29) In the matter of Krishna Hare Gaur (supra), the Hon’ble Supreme Court has held that when the appointment is made dehors the rules, the same is a nullity and the statutory bar like the doctrine of res judicata is not attracted. Relevant para 15 is reproduced herein below:- “15. When the appointment is made de hors the rules, the same is a nullity. In such an eventuality, the statutory bar like doctrine of res judicata is not attracted. In the case of Meghmala & Ors. Vs. G. Narasimha Reddy & Ors.[1], this Court held as under:- "36. From the above, it is evident that 23 even in judicial proceedings, once a fraud is proved, all advantages gained by playing fraud can be taken away. In such an eventuality the questions of non-executing of the statutory remedies or statutory bars like doctrine of res judicata are not attracted. Suppression of any material fact/document amounts to a fraud on the court. Every court has an inherent power to recall its own order obtained by fraud as the order so obtained is non est." Since respondent No.1 obtained appointment on the basis of bogus certificates, in our considered view, the principle of res judicata will not be attracted to the case on hand. 30) In the matter of Joshep (died) through his Lrs. (supra) it was held that an agreement which is unenforceable by law is said to be void and by way of auction, sale title can not be transferred in favour of the purchaser. Relevant paras 24, 29 & 30 are reproduced herein below:- “24. Reverting to the facts of the present case in the light of principle of law laid down by the Supreme Court and the Madhya Pradesh High Court in above-stated judgments (supra) construing the word "transfer" occurring in Section 165(6) of the Code, liberally giving it extended meaning to further the object of legislature behind enacting the said provision, it would appear that the 'auction-sale' of land belonging to aboriginal tribe to recover amount of loan, would amount to "transfer" within the meaning of Section 165(6) of the Code, as this interpretation only furthers the object of the legislature rather than defeats it, taking the other view of the matter, would deprive the aboriginal to be his title, vesting land in favour of non-aboriginal tribe and the same is void being prohibited by law and even by auction sale in order to recover the amount advanced to the plaintiff, his property could not be sold being expressly forbidden by law and being opposed to public policy within the meaning of Section 23 of the Indian Contract Act, 1872. Section 2(g) of the Indian Contract Act, 1872 also provides that an agreement which is unenforceable by law is said to be void, as such, by way of auction sale title has not been conferred to the plaintiff, even though the express provision of this effect barring auction sale as a consequence of transaction of sale came into force w.e.f. 29.11.1976. -24- 29. The above-stated provision came into force w.e.f. 15.3.1976 and in the instant case, auction sale was made on 29.2.1976, but confirmed under the MP Co- operative Societies Rules, 1962 on 6.4.1976. The Supreme Court in the matter of Valji Khimji and Company v. Official Liquidator of Hindustan Nitro Product (Gujarat) Limited and others (2008) 9 SCC 299: (2008 AIR SCW 5828) has held that where the auction is subject to subsequent confirmation by same authority under a statute or terms of auction, the auction is not complete and no rights accrue until the same is confirmed by said authority and upon confirmation of sale by that authority, certain right accrue in favour of auction purchaser. Therefore, in the instant case, alleged right on suit land accrued in favour of the plaintiff by auction upon confirmation as per Rules of 1962 on 6.4.1976 ie after coming into force of Section 41-A(5) of the Act of 1960 and since this provision bars the transfer of a land belonging to aboriginal tribe/defendants, it would also include transfer by auction sale and as such, auction sale was also statutorily barred by Section 41-A(5) of the Act of 1960, as such, their right in property is inalienable right and being notified aboriginal tribes, they have right to development and come to main stream of the society. 30. Therefore, both the Courts below are absolutely unjustified in granting decree in favour of the defendant as auction sale of the land belonging to the plaintiff who is notified aboriginal tribe under Section 165(6) of the Code and such auction sale is hit by Section 165(6) of the Code as well as by Section 41-A(5) of the Act of 1960. The substantial question is answered accordingly. 31) In the matter of S.P. Chengalvaraya Naidu (supra), under relevant paras, it was observed and held as below:- “5.The High Court, in our view, fell into patent error. The short question before the High Court was whether in the facts and circumstances of this case, Jagannath obtained the preliminary decree by playing fraud on the court. The High Court, however, went haywire and made observations which are wholly perverse. We do not agree with the High Court that "there is no legal duty cast upon the plaintiff to come to court with a true case and prove it by true evidence". The principle of "finality of litigation" cannot be pressed to the extent of such an absurdity that it becomes an engine of fraud in the hands of dishonest litigants. The courts of law are meant for imparting justice between the parties. 25 One who comes to the court, must come with clean hands. We are constrained to say that more often than not, process of the court is being abused. Property- grabbers, tax-evaders, bank-loan-dodgers and other unscrupulous persons from all walks of life find the court-process a convenient lever to retain the illegal- gains indefinitely. We have no hesitation to say that a person, who's case is based on falsehood, has no right to approach the court. He can be summarily thrown out at any stage of the litigation. 6. The facts of the present case leave no manner of doubt that Jagannath obtained the preliminary decree by playing fraud on the court. A fraud is an act of deliberate deception with the design of securing something by taking unfair advantage of another. It is a deception in order to gain by another's loss. It is a cheating intended to get an advantage. Jagannath was working as a clerk with Chunilal Sowcar. He purchased the property in the court auction on behalf of Chunilal Sowcar. He had, on his own volition, executed the registered release deed (Ex. B-15) in favour of Chunilal Sowcar regarding the property in dispute. He knew that the appellants had paid the total decretal amount to his master Chunilal Sowcar. Without disclosing all these facts, he filed the suit for the partition of the property on the ground that he had purchased the property on his own behalf and not on behalf of Chunilal Sowcar. Non-production and even non-mentioning of the release deed at the trial is tantamount to playing fraud on the court. We do not agree with the observations of the High Court that the appellants- defendants could have easily produced the certified registered copy of Ex. B-15 and non-suited the plaintiff. A litigant, who approaches the court, is bound to produce all the documents executed by him which are relevant to the litigation. If he withholds a vital document in order to gain advantage on the other side then he would be guilty of playing fraud on the court as well as on the opposite party.“ 32) Taking into consideration the above-discussed facts and the law laid down by the Hon’ble Supreme Court and the High Court, it can safely be held that the excise contract was not transferred in accordance with the law in favour of the father of late Rekha Singh or Late Rekha Singh and their lands were auctioned contrary to the provisions of Sections 165(6) and 170-B of the Code of 1959; the principle of res judicata would not apply as the property of -26- members of the aboriginal tribe was put for auction-sale by playing fraud. The petitioners could not produce documents to establish execution of a valid agreement or license in favor of Late Rekha Singh or her father. Further, the petitioners could not prove that the agreement or license entered into between the State of M.P. and Mr. K.K. Agrawal was legally transferable. The petitioners and State could not put forth any reason as to why action was not taken against Mr. K.K. Agrawal or his guarantor Devnarayan Singh. The report submitted by the Excise Department Annexure R/8 clearly supports the case of respondents No. 1 to 3, wherein it was found that fraud was played with Late Rekha Singh and her father. Also, the findings recorded in the agreement have not been challenged by the petitioners. 33) The factum of fraud and dishonesty surface on the record and this Court should not perpetuate the same therefore in the opinion of this Court, the order passed by the Commissioner does not require any interference. 34) Consequently, the present petition fails and is hereby dismissed. No cost(s). Sd/- (Rakesh Mohan Pandey) Judge Rekha